Stumping for Waste: Amtrak Subsidies Become a Campaign Issue
Wednesday September 12th, 2012 • Posted by K. Lloyd Billingsley at 10:05am PDT • 7 Comments
Last year 30 million passengers road Amtrak, which on September 10 announced monthly ridership records for the last 11 months. That should come as no surprise with gasoline above $4 a gallon in much of the country. But Amtrak bosses, doubtless looking for more federal handouts, left out a few realities.
Last year Amtrak lost more than $450 million and the federal government pitched in $562 million just to keep the operations side rolling. Tack on $650 million for capital costs in 2011 and you have the better part of Amtrak’s $1.5 billion subsidy, about $50 per ticket. The massive federal subsidies continue regardless of ridership levels and other developments.
Despite its monopoly, Amtrak lost nearly $1 billion – $834 million, more than $80 million a year – on food and drink services since 2002, much of it due to fraud and theft. Despite federal dollars Amtrak is cutting key services in some areas and late arrivals continue to be a problem. Even seven-figure subsidies can’t make trains arrive on time.
Amtrak has become a campaign issue with Vice President Joe Biden who describes himself as “the biggest railroad guy you’ve ever known,” stumping for the subsidized system that recently renamed a station after him. Republicans claim they want to end Amtrak subsidies and privatize the system. In June, however, the GOP-controlled House increased Amtrak’s overall funding by $384 million to offset reductions in operating subsidies. That doesn’t sound like privatization.
One pro-Amtrak editorial conceded that “Even with a major infusion of federal funding Amtrak would be years away from matching European passenger rail systems, which include bullet trains that can run at top speeds in excess of 200 mph.” Speed and ridership aside, Amtrak remains years away from breaking even and that is unlikely to change.
California, meanwhile, wants to build a bullet train and in near-bankruptcy looks to federal funds. A major champion of the project is governor Jerry Brown, a former presidential candidate who in his first stint as governor during the 1970s pushed for California to have its own space program.
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Chet, You are hence an advocate of an authoritarian/socialist transportation system run by some central agency and imposed on the citizenry by force, as in the former Soviet Union. The track record of such systems indicate that they always are abysmal; failures, have enormous costs, and are the direct cause of environmental ruin, traffic congestion, and other ills that you are seeking to overcome.
Instead, we would suggest that all transportation should be privatized and marketized so that people are free to compete and innovate and be held accountable for harms to others. In a government system, the ruling elites are always exempted from responsibility and the benefits go to those with the most political clout. Indeed, statist systems are based on the idea of redistributing wealth and power from the many to the few and costs and liability from the few to the many.
Please see the following books:
Street Smart: Competition, Entrepreneurship, and the Future of Roads, edited by Gabriel Roth
The Voluntary City: Choice, Community, and Civil Society, edited by David T. Beito, Peter Gordon, and Alexander Tabarrok
Beyond Politics: The Roots of Government Failure, by Randy T. Simmons
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john says:
I ride Amtrak all the time, and have enjoyed every trip I’ve taken. My question is since so many of the long trip are sold out, why can’t they just add on extra cars to take more people on each trip. They also need to have a better set of connections.. I think it is kinda dumb to go from Albuquerque to Chicago to Washington DC then to Florida when I can catch the train going from LA to Florida but I have to take a bus from Albuquerque 5 hours to Deming NM to catch Amtrak...they need a better and more complete network.
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Jason says:
Chet, nothing is free. What you want is for people who work harder to be forced to pay the way of lazy bums. If people wanted to ride the train, they would do so. If it would save people money to ride the train, as you say, they are free to chose that mode of transportation if they wish.
They can save their money by riding the train, and I will “waste” my money by driving my cars wherever I want, whenever I want. People with important things to do can’t go to a train station, wait for the train to be late, and then ride it to another station where it arrives late and they have to wait once more for transportation to their final destination.
If the majority of people don’t want something, why do people in the minority like you think that you should support the government takeover of anything you want, but can’t pay for?
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Roger says:
David,
What does “authoritarian/socialist” mean? Just another dirty name to call someone who has a different viewpoint. “Imposed by force” and “Soviet Union”, are only more negative propagandist cliches.
Get real and argue with Chet without the BS. Tell him why train transportation should be allowed to die as an alternative to plane or bus. Tell him why it makes sense and why it will benefit middle class Americans (or those who are left). He’s not going to read the propaganda you recommend, so make your own argument here.
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Roger, I have made the argument and provided references to sustain it. If you believe that people should be compelled to fund your transportation, housing, food, schools, or healthcare, then you are an authoritarian who believes in socializing such entities because for you, the end justifies the means.
Amtrak is socialism in passenger rail transportation. It is a money loser, is an incoherent system that serves few people, and exists because of the special interests who benefit from it. Train service should no more be a government domain than should shoes, restaurants, or cargo shipping.
Here is an excellent article on how and why government got into the rail business and the huge disadvantages for doing so, all at the public’s expense:
“Development of the American Railroad Network During the Early 19th Century: Private versus Public Enterprise,” by Clifford F. Thies
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Pat Traynor says:
In college at NIU we had free buses around campus and the small town of DeKalb, IL. This system worked well. No cost was wasted collecting fares. Buses were supposed to be only for students with ID’s shown but ID was never asked for. Buses were crowded, frequent and fast and ran in a limited fashion at all hours. In this special circumstance free buses worked well avoiding parking lots and auto cost and congestion. Cost per passenger mile was low because of the high rate of usage.
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I believe that America should have a public train and bus system free of charge to all riders in America. How does that grab ya? So, of course I believe that the trains and buses should be federally subsidized, funded and free. You think that is crazy? Think about how much it would cost to do that versus how much it cost America for every person to own a car? Think about how that would improve our environment with less wear and tear on city and interstate infrastructure and less air pollution..The federal funding of a free system of public transportation would pay for itself in no time and be a great American achievement in my opinion..